Semi-weekly south Kentuckian. [volume] (Hopkinsville, Ky.) 1883-1889, 1887-11-15
NATIONAL BANKING.
Banking Systems of the United States
Since Banks We're First Known.


Banking Systems of the United States
Since Banks We're First Known.
The first bank in this country was in
Philadelphia in 1880. and the bank Of
North America was planned for 1881
and opened 1882. The Massachusetts,
bank was Incorporated 1888; that Of
New York was chartered 1871. although
since 1884 under Alexander Hamilton'I
ARTICLES Of Association" had besn
doing business. Alexander Hamilton
also originated plan for United
States bank with capital of $40. 900.
900, threc-fourths to be paid in United
States stock at six per cent, which
plan was adopted and approved by
Washington in 1871. The bank was
reorganized In 1916 with a capital o.
s35. 900, 900. the United States subscrlb,
ing 81, 900. 900 with interest at pei
cent, but in consequence of genera
financial depression was the next yoai
Cl792O in great danger of failure. The
United States Legislature refusing tc
renew the charter, aState bank, called
the United States Bank, was chartered
in Pennsylvania, and eventually failing,
the:whole account was settled 1856. The
e2S, 900, 900 deposited by shareholders
was totally lost while the Government
realized S7,0S3. 167 upon its Investment
Of stock. State banks were afterwards
chartered in the interest of individual
and dominant political parties. The
charters were sometimes fraudulently
obtained and currency issued to three
times the amount of their capital. and
In 1914. 1887 and 1857 many Of them
suspended payment A reform move
ment in bank currency was inaugu-
rated in Massachusetts, in 1925, and a
safety fund system" recommended by
Mr. Van Buren. adopted in 1929. In
1888 the Free Bank Act" passed the
New York Legislature. which author
lied any number of persons to form a
bank association subject to certain
specific conditions and liabilities.
Banks may now be organized by any
number of persons over five, with a
capital of at least a $400, 900 unless In
cities of less than 5000 inhabitants,
when capital of $50, 900 is needed,
while If the population is $4,000 the
capital must exceed 5000, 900. One
third Of the capital must be invested
In United States bonds and eirou-
'lating notes to the. amount Of 90 per
cent may be issued upon this. In 1877.
an act provided for tho deposition
with the treasurer of sums Of not loss
than $4,000 and tho withdrawal OF
bonds as security; another, 1873.
authoa-lzedan issue Of circulating notes
unlimited In extent but commanded
tho retirement of legal tender notes,
till they should be reduced to $780,
000.00 The New York banks were
required to hold one-quarter Of their
deposits and circulation as reserve
fund, others to hold 10 per cent. fol
the same purpose. But this provision
was repealed in 1874 The interest al
which National banks may loan money
Is regulated by tho law Of the States
(but where none such is stated z per
cent. has been generally understood. J
The surplus of tho banks was in 1868.
$50 900, 900. and in 1877, $3.50, 600, 900.
One thousand six hundred and twelve
State banks have been turned into Ma
tional banks, and have brought S40,.
900. 900 into the system. One per cent.
tax is annually paid upon the circula-
ton of the bank, and onc-half pei
cent. upon thoIr capital not in United
States bonds, - Toledo Blade.